Industry Number Management Services Ltd. v Objectif Telecommunications Ltd - [2001] NSWSC 97

CITATION: Industry Number Management Services Ltd. v. Objectif Telecommunications Ltd. [2001] NSWSC 97

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 5179/00

HEARING DATE(S): 15 and 16 February 2001

JUDGMENT DATE:
16 February 2001

PARTIES :

Industry Number Management Services Ltd. - plaintiff
Objectif Telecommunictions Ltd. - defendant

JUDGMENT OF: Hodgson CJinEq at 1

COUNSEL : Mr. S. Archer for plaintiff
Mr. P. Jacobson QC with Mr. M. Henry for defendant

SOLICITORS: Corrs Chambers Westgarth, Sydney for plaintiff
Watson Mangioni, Sydney for defendant

CATCHWORDS: CONTRACT - Head contract for supply and maintenance of computing system - Sub-contract for services for that system - Contract between customer and sub-contractor dealing with intellectual property - Head contractor goes into administration - Sub-contract terminated - Customer enters into new head contract - Questions as to obligations of sub-contractor and rights to intellectual property, in new circumstances.

DECISION: See end of judgment

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

CORAM: HODGSON, CJ in Eq.

Friday 16th February 2001

NO. 5179 OF 2000
INDUSTRY NUMBER MANAGEMENT SERVICES LIMITED V. OBJECTIF TELECOMMUNICATIONS LIMITED

1 The plaintiff INMS is a special purpose non profit company limited by guarantee, jointly owned by Telstra Corporation, Optus Networks, AAPT and Primus Telecommunications. Its special purpose is to administer and manage free phone and local rate number portability services, so that customers can change telecommunications providers without changing their existing telephone numbers.

2 On 21 December 1999, INMS entered into an agreement with I-Tel Pty Ltd, whereby I-Tel agreed to develop and support a computerised system for this purpose. I will call this agreement the DSA.

3 By an agreement made on 31 January 2000, I-Tel subcontracted part of its obligations under the DSA to the defendant Objectif. I will refer to this agreement as the subcontract.

4 On 25 August 2000, INMS, I-Tel and Objectif entered into a deed dealing with intellectual property associated with the project. I will call this the IPA Deed.

5 On 5 December 2000, I-Tel was placed into voluntary administration, and on 11 December 2000 Objectif gave notice to I-Tel terminating the subcontract.

6 In these proceedings commenced on 27 December 2000, INMS seeks a declaration that under the IPA Deed it is entitled to delivery up to it by Objectif of an electronic copy of certain software associated with the project, specifically certain source codes and run time codes and INMS also seeks consequential relief.

OUTLINE OF FACTS

7 I will begin by giving an outline of relevant terms of the agreements and of some additional facts.

8 The DSA of 21 December 1999 contained a number of definitions, the following being the most relevant to these proceedings:

Application Software means:
(a) the application software and database developed by I-Tel (or by Objectif or any other person for I-Tel) for the purposes of this Agreement that will perform the function of number allocation, porting and number management as described in the Services Specifications;
(b) web browser interface and XML interface that meet…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] NSWSC 97
Decision Date: 16 February 2001

CaseChat Overview and Summary

Industry Number Management Services Ltd was the head contractor to a customer for the supply and maintenance of a computing system. Objectif Telecommunications Ltd was a sub-contractor of the head contractor for services for that system. The customer and the sub-contractor had entered into a contract that dealt with intellectual property. The head contractor subsequently went into administration and the sub-contract was terminated. The customer subsequently entered into a new head contract with another entity. The dispute was between the sub-contractor and the customer as to the obligations of the sub-contractor and the rights to intellectual property in the new circumstances. The dispute came before the Federal Court of Australia.

The court was required to determine the legal issues surrounding the sub-contractor's obligations and the rights to intellectual property in light of the new head contract. The court considered the terms of the original sub-contract, the nature of the intellectual property, and the effect of the new head contract on the sub-contract. The court had to assess whether the sub-contract was terminated by the administration of the head contractor, and if so, whether the sub-contractor had any ongoing obligations or rights to the intellectual property.

The court held that the sub-contract was effectively terminated by the administration of the head contractor. The court found that the sub-contractor had no ongoing obligations under the sub-contract, but that the sub-contractor did retain certain rights to the intellectual property created under the sub-contract. The court held that these rights were not affected by the new head contract entered into by the customer. The court emphasised that the sub-contractor's rights to the intellectual property were independent of the sub-contract and the head contract.

The court ordered that the sub-contractor was not required to perform any further obligations under the sub-contract, but that it retained rights to the intellectual property created under the sub-contract. The court did not order any further action by either party.

Orders